Wrapping up Q2 earnings, we look at the numbers and key takeaways for the semiconductor manufacturing stocks, including Marvell Technology (NASDAQ:MRVL) and its peers.

The semiconductor industry is driven by demand for advanced electronic products like smartphones, PCs, servers, and data storage. The need for technologies like artificial intelligence, 5G networks, and smart cars is also creating the next wave of growth for the industry. Keeping up with this dynamism requires new tools that can design, fabricate, and test chips at ever smaller sizes and more complex architectures, creating a dire need for semiconductor capital manufacturing equipment.

The 14 semiconductor manufacturing stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 1.8% while next quarter’s revenue guidance was 2.7% below.

Inflation progressed towards the Fed's 2% goal recently, leading the Fed to reduce its policy rate by 50bps (half a percent or 0.5%) in September 2024. This is the first cut in four years. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be debating whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.

While some semiconductor manufacturing stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 4.2% since the latest earnings results.

Marvell Technology (NASDAQ:MRVL)

Moving away from a low margin storage device management chips in one of the biggest semiconductor business model pivots of the past decade, Marvell Technology (NASDAQ: MRVL) is a fabless designer of special purpose data processing and networking chips used by data centers, communications carriers, enterprises, and autos.

Marvell Technology reported revenues of $1.27 billion, down 5.1% year on year. This print exceeded analysts’ expectations by 1.5%. Overall, it was a very strong quarter for the company with a significant improvement in its gross margin and inventory levels.

"Marvell's second quarter revenue grew 10% sequentially, above the mid-point of guidance driven by strong demand from AI. We saw strong growth from our electro-optics products and our custom AI programs began to ramp," said Matt Murphy, Marvell's Chairman and CEO.

Interestingly, the stock is up 15.3% since reporting and currently trades at $80.51.

Is now the time to buy Marvell Technology? Access our full analysis of the earnings results here, it’s free.

Best Q2: Nova (NASDAQ:NVMI)

Headquartered in Israel, Nova (NASDAQ:NVMI) is a provider of quality control systems used in semiconductor manufacturing.

Nova reported revenues of $156.9 million, up 27.8% year on year, outperforming analysts’ expectations by 5.9%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and a significant improvement in its operating margin.

Nova achieved the fastest revenue growth among its peers. The market seems content with the results as the stock is up 3.3% since reporting. It currently trades at $187.20.

Is now the time to buy Nova? Access our full analysis of the earnings results here, it’s free.

Slowest Q2: Photronics (NASDAQ:PLAB)

Sporting a global footprint of facilities, Photronics (NASDAQ:PLAB) is a manufacturer of photomasks, templates used to transfer patterns onto semiconductor wafers.

Photronics reported revenues of $211 million, down 5.9% year on year, falling short of analysts’ expectations by 6.2%. It was a softer quarter as it posted underwhelming revenue guidance for the next quarter and a miss of analysts’ EPS estimates.

Photronics delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 1% since the results and currently trades at $23.80.

Read our full analysis of Photronics’s results here.

FormFactor (NASDAQ:FORM)

With customers across the foundry and fabless markets, FormFactor (NASDAQ:FORM) is a US-based provider of test and measurement technologies for semiconductors.

FormFactor reported revenues of $197.5 million, up 26.7% year on year. This print surpassed analysts’ expectations by 1.3%. Overall, it was an exceptional quarter as it also logged a significant improvement in its gross margin and an impressive beat of analysts’ EPS estimates.

The stock is down 17.6% since reporting and currently trades at $44.16.

Read our full, actionable report on FormFactor here, it’s free.

Applied Materials (NASDAQ:AMAT)

Founded in 1967 as the first company to develop tools for other businesses in the semiconductor industry, Applied Materials (NASDAQ:AMAT) is the largest provider of semiconductor wafer fabrication equipment.

Applied Materials reported revenues of $6.78 billion, up 5.5% year on year. This result beat analysts’ expectations by 1.6%. It was a strong quarter as it also produced a solid beat of analysts’ EPS estimates and a meaningful improvement in its inventory levels.

The stock is down 12.6% since reporting and currently trades at $185.46.

Read our full, actionable report on Applied Materials here, it’s free.

Join Paid Stock Investor Research

Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.